STRONGER PATENTS ACT -The Pro Patent Force Awakens

Legislation has been introduced today sounding the charge for a pro-patent congressional counter-attack to the patent reform carnage currently afflicting the patent landscape. This new Stronger Patents Act of 2017 will be strongly resisted by the big tech infringer oligopoly. House amendments could convert it into a new Innovation Act. Research universities must actively engage directly now by expressing their support. This effort could backfire into a Bay of Pigs-type defeat if we do not. As you will see from the summary below, this proposal addresses both AIA flaws and SCOTUS imposed harms inflicted on today’s patent landscape harming research university commercialization essential to obtaining research grants.

Here is the sponsor’s one-pager summarizing the bill. This is big bold and beautiful. Please urge your university spokespeople to act quickly.

Continue reading STRONGER PATENTS ACT -The Pro Patent Force Awakens

New PTO Director and Returning Patent Property Rights

As everyone not pinned under a rock or away on an exotic vacation knows by now, SCOTUS has agreed to decide whether PTAB has the constitutional authority to nullify patent rights in a mini-trial process (principally AIA’s IPR). The precise question before the Oil States Court is:

“Whether inter partes review – an adversarial process used by the Patent and Trademark Office (PTO) to analyze the validity of existing patents violates the Constitution by extinguishing private property rights through a non-Article III forum without a jury.”

Having rejected cert in earlier appeals raising the same issue (including MCM v HP ) experienced observers are speculating and theorizing about the SCOTUS reasons for agreeing over the objections of the Solicitor General to hear it. In a timely letter to Commerce Secretary Wilber Ross, the Licensing Executive Society ( LES) which is ably led by Brian P. O’ Shuaghnnesy advised the Secretary regarding its recommended qualifications appointment of a new PTO Director.The letter enumerated some of the many problems affecting our US patent system including a strong argument for patents as “property.” A few excerpts from the letter are below. We recommend reading it in its entirety.

LES Letter Excerpts:
“Above all, LES recommends appointing a Director dedicated to protecting intellectual property, generally, and patents in particular, as the private property right our nation’s founders envisioned.The founders saw great value in rewarding individuals who toil to bring forth from commonly accessible resources useful products and processes by granting to those individuals an enforceable property right. They recognized that such a property right would, in the fullness of time, work a substantial benefit to the public by encouraging innovation and disclosure.We must honor that philosophy.It contributed substantially to America’s rapid ascendancy from agrarian economy to industrial powerhouse and can be traced to America’s first patent act of 1792.In affording that private property right, we reward and empower the archetypal American innovator, the individual daring to risk all to bring forth the next big thing, and thereby challenge market incumbents who benefit from stasis and the status quo.”

“Commercial development of innovation, and new business formation, demands the prompt and predictable grant of durable property rights, and a reasonable expectation of the enjoyment of quiet title upon issuance. Financing of new enterprises, and the growth of existing ones demands intellectual assets that stand up to challenge, regardless how hose assets are derived or commercialized. American innovators deserve strong, predictable, enforceable intellectual property rights, and that starts at the USPTO. Regrettably, recent changes, both legislative and precedential, have chipped away at US patent rights. Meanwhile, patents issued by other countries are increasingly perceived to be more predictable and enforceable, and thus to have greater value. Investment, and ultimately innovation, will migrate to those environments.” Continue reading New PTO Director and Returning Patent Property Rights

USPTO Fee Diversion

In a quick release, Gene Quinn explained that the USPTO got what it asked for in the Trump budget. There appears to be no fee diversion. The House will begin the process anew anyway so it may be too early to expect fee diversion to end in our lifetime. As Gene puts it:

“Under President Trump’s FY 2018 budget the USPTO will receive $3,586,193,000 from fees collected and to be available until expended. This appropriation would result in $0 being provided to the USPTO from the general fund of the United States. Any fees collected by the USPTO in excess of that amount would be deposited into the Patent and Trademark Fee Reserve Fund and remain available until expended. There does not appear to be any mention of any fee diversion anywhere, which would mean the USPTO has dodged the fee diversion hands of an often greedy federal government who over the last 30 years has frequently diverted user fees to other purposes.”

The other budgetary language quoted below is either routine or an indication where underlined that the anti-patent curtailing of frivolous lawsuits interpretation justifying PTAB has been affirmed by the administration. We will just have to wait and see.

“Requested funding for 2018 will be used for examining patent applications and granting patents. USPTO will continue its aggressive patent pendency reduction agenda to reduce overall pendency and backlog; continue to enhance patent quality; ensure optimal information technology service delivery to all users; improve the appeal and post-grant processes, and improve intellectual property protections worldwide. The Budget supports USPTO’s administrative efforts to address abusive patent litigation practices and repeats the President’s call for Congress to enact legislation that promotes greater transparency in the U.S. patent system and prevents frivolous lawsuits that stifle innovation.”

To read Gene’s timely post on the issue, please visit our always free website at ipstrategic.com

USPTO gets $3.6 billion in President’s FY 2018 budget, avoids fee diversion

AAMC Acts Collectively to Rescue NIH’s Commercialization Mission

On the day the president’s budget was released this week 300+ medically engaged entities and associations nationwide, the backbone of our nation’s biomedical research ecosystem including many universities, disease advocacy groups, and medical centers, signed a full-page ad in the WSJ and POLITICO. Sponsored by “The Ad Hoc Group For Medical Research” and paid for by the Assoc. of American Medical Collages, its purpose was to thank Congress for its recent increased support for basic medical research. Ascribing US medical and economic strength to congressional bipartisan medical research, its content was straightforward and simple.

“When it comes to the Nation’s health
There’s One thing we can all agree on
Medical research Makes America Healthier and Stronger. ”
“LET’S KEEP THE PROGRESS GOING. INCREASE FUNDING FOR NIH BY 2 BILLION IN 2018.”

IP Strategic gratefully salutes this concerted effort to come to the rescue of NIH’s critical role in our life science innovation ecosystem.

Within our national health care ecosystem, NIH is the bridge between congressional R&D public investment in otherwise uninvestable life science and private sector development of its commercially promising results through Bayh-Dole directed commercialization. The ad’s focus is the NIH’s bridge’s on-ramp of congressional R&D funding. For the ecosystem to work the commercialization bridge’s off-ramp of private sector investment and development also must provide public benefit with its therapies, jobs and economic development. Off-ramp commercialization requires private sector investment which in turn requires reliable patent protection. Support and direction of commercialization bridge traffic flow is NIH’s mission. That bridging mission is undercut at its entry point by the Trump budget and effectively undermined at its exit point by patent uncertainties created by Congress, SCOTUS, and the USPTO. Here are just a few: Continue reading AAMC Acts Collectively to Rescue NIH’s Commercialization Mission

Essay Summarizing IPR Concerns Voiced by Panelists at PTO

I recently joined Robert Sterne, Judge Paul Michel, Peter Detkin, Damon C Mateo, Paul Evans and Paul Stone on a panel at the Advanced Patent Law Institute’s annual presentation at the USPTO. Kevin Madigan begins his summary the conference’s opening presentation with the paragraph below. It is a useful overview of a presentation to an audience of advanced patent experts with Director Lee (USPTO) seated in the front row.

“Last month, the United States Patent & Trademark Office (USPTO), along with the University of Texas Law School and Antonin Scalia Law School, George Mason University, hosted the 12th annual Advanced Patent Law Institute in Alexandria, Virginia. The program featured a distinguished panel of patent experts discussing “current issues around patenting, licensing, enforcing, and monetizing patents in the U.S., and look[ing] at what the UK, EU, and China are experiencing and the impact on U.S. patent practice.” Titled The Current Patent Landscape in the US and Abroad and focusing on the economic factors that spur invention, the consensus was that dramatic changes to the US patent system are driving investment in research and development outside the country and threatening the future of American innovation.”

You can read Kevin Madigan’s excellent article in its entirety here.

Fundamental Incongruities of PTAB Operations Affect the Integrity of the Patent System

This article appeared first on ipwatchdog.com

The first 100 days of the Trump Administration have now come and gone. So far, they have not revealed much more than the obvious fact that there is a significant disconnect between President Trump’s 4-year re-election objectives and the 2-year re-election timetable of House Republicans. Retaining their seats is job one for both. The President believes that will require Republicans to enact legislation on the issues central to the President’s campaign and the party Platform; issues Republicans have been complaining about over the past eight years.

The mismatched re-election priorities of Republicans can be expected to continue roiling Capitol Hill throughout the remainder of 2017 and likely into 2018. With healthcare and tax reform likely to take up much of the summer oxygen in Washington, DC, and into the fall of 2017 when insurance premium hikes will be announced again, what, if any, signature Republican issues will be addressed remains in significant doubt.

With small ball policy left far behind by both inter-party and intra-party politics, what will the current state of Congressional legislative enactment capacity mean for patent reform? An argument could be made that so much energy will be placed elsewhere that matters of peripheral importance in the greater scheme – like patent reform – will receive no attention. But intellectual property generally and patent policy more specifically tends to be an apolitical issue where ideologues on both sides of the aisle can reach agreement. Without knowing how the cards will fall, and given that those who perpetually seek patent reform are once again working the halls of the Capitol, prudence suggests that those with a pro-patent vision remain ever vigilant.

Last week IPWatchdog.com explained why eBay, Mayo and the creation of the Patent Trial and Appeal Board to hear post-grant challenges to patents were the three most significant legal causes of today’s patent crisis.  The common thread that led to each “event” was a brilliant anti-patent strategy that converted policy maker apathy towards patents and our nation’s innovation ecosystem into a belief that simply stopping a few bad actors by passing comprehensive patent litigation reform would solve any ills.

The patent troll narrative has worked well. Indeed, at a recent hearing of the Senate Judiciary Committee Senator Dick Durbin (D-IL) quipped: “Whoever came up with that phrase should get a special bonus because they manage to mischaracterize anyone who goes to court to assert patent rights as a troll…”

The beauty of the patent troll narrative was it took little time to absorb and instantly painted a pejorative picture in the minds-eye of the listener. It became easy to repeat. Its bumper-sticker simplicity led to widespread usage, which ultimately (and quickly) became accepted as fact without much, if any, critical thought. Most important, the strategy by-passed the arcane complexity of its convoluted subject matter by shifting the burden of Congressional persuasion to its victimized and under-resourced opponents. Politically outmatched from the start – inventors and innovators had, up until this point in our history, always been held in high esteem were overwhelmed. That suddenly changed with the patent troll narrative and inventors became persona non grata, even viewed as evil and villainous. Indeed patent reform’s innate obscurity was its most important ally. Few knew more than the patent troll narrative, so as it was often repeated people unfamiliar with patents on even the most basic level became horrified by the myth the narrative painted.

Over the next 100 days, patent reform’s obscurity may become the enemy of patent reform instead of its ally. After all, if the public isn’t interested in patent reform why should President Trump spend time on the issue? Moreover its proud parent, “efficient infringement,” has now become the enemy of Trump’s conservative, property-devoted base. Patents are property rights as has been recognized by the U.S. Supreme Court for over 100 years and as stated explicitly in the Patent Act. Nevertheless, the patent troll narrative has returned to Capitol Hill. Even with more pro-property right, security-conscious, conservative allies than in previous cycles patent reform opponents, who 500 days ago rallied loudly enough to make HR 9 too controversial for pre-campaign enactment, must rise again.

Expect big tech and its leftist bed-fellows to exert more effort to “de-propertize” patents on Capitol Hill and in the courts. Expect to hear that every patent holder who protects her lawfully established exclusivity by responding to efficient infringement in courts to be called “ambulance chasers.” Expect proponents of reform to mischaracterize patent reform as a step towards tort reform, which is nearly comical given that the tortfeasor in the equation is the party that is trampling on the property rights of patent holders through infringement, which is many times purposeful and willful. Expect lobbyists for Main Street retailers to again be flattered by attention from big shot Silicon Valley lobbyists and support their latest version of the anti-patent, anti-property right patent troll narrative. Expect new academic junk science and more speculation by professorial patent policy “experts.” Expect the USPTO to praise the PTAB’s star-chambered repression of so-called “bad patents.” Expect efficient infringement to continue while the courts and Congress are asked to dither over patent trolls.

We must explain the truth to those who understandably drank the patent troll Kool-Aid and believed that Silicon Valley’s tears for Main Street retailers were real. Efficient infringement’s cheaper, faster, better economics compel its continued deployment. The patent troll narrative has distracted Congress and the courts from seeing how it protects incumbency for our nation’s most dominant big caps by diluting investability in new technology that might one day unseat them. The patent troll narrative’s flaw is that the repressive litigation it supports applies not to a few remaining patent abusers but to ALL patent holders, especially startups who produce the most jobs.

The efficient infringement narrative is no more complicated than the troll narrative. The patent troll narrative just reached the Hill first, which means the story of efficient infringers trampling patent property rights, though perfectly true, has a tougher road given it must not only gain its own traction but it has to undo the damage caused by the misleading patent troll narrative.

To be re-elected Congress may need to focus on less obscure issues this year than patent reform. But if party leaders choose to consider patent reform the bill will be driven by the patent troll narrative, not its content. Pro-patent Senator Chris Coons (D-DE) has wisely reminded us that Congress likes to learn through stories. Patent reform’s proponents will again bypass content explanations by repeating the patent troll narrative. Pro-patent opponents can respond with their own efficient infringement narrative. Let proponents then explain the contents of any bill in simple, easy to understand terms. Let us work to put a face on efficient infringement, which has ruined so many inventors who have seen Silicon Valley giants make so many millions of dollars infringing patents after taking technology originally invented by individuals and small start-up businesses who never had a chance.

 

Time to Undo eBay

Are infringed patent holders entitled to remediation as owners of the personal property? Or do valid as violated patents protect their subject matter with ill-defined”liability” theory with “attributes” derived from their structure, owner identity, or developmental stage in the stream of commercial development.? The debate depicted by this false “choice” is economically and legally debilitating. It is undermining the centuries-old reliability of US patents. With SCOTUS benches filled again our patent system’s future now depends upon reversing the 2006 eBay detour from our patent system’s history and original purpose. SCOTUS must act soon or it will be too late to save US based innovation. The Court should return our patent law to the Lockean definition our founding fathers relied on while drafting our Constitution. It is time to recall Abe Lincoln’s famous phrases about investors’ “fuel of interest” in inventors’ “fire of genius”. The fuel of investors’ interest is running low. Our innovation ecosystem is sputtering. Investment in commercializing university basic research is shrinking. For some institutions such investment public and private investment funding it is an existential issue.
eBay and its concurring opinion by Justice Kennedy signaled SCOTUS’ surrender to the misdirection of a congressional and amicus brief “bait-and-switch” campaign by big ICT tech. Its “bait-and-switch assertions have since been proven wrong. Whatever merit they once had have been appropriately addressed.  Big techs’ strategic goal was to protect themselves from the remedial consequences of their “efficient infringement”, an economically fruitful but systemically amoral business model they feel compelled to continue. Sadly they conned the Courts into killing injunctions for everyone but themselves.  Big tech’s tactical rhetoric is what infected eBay. Ever since it has contaminated SCOTUS jurisprudence. It has also led to sanctioning PTAB’s intrusive elimination of statutory presumptive validity and its unconstitutional obliteration of trial by jury. Injunctions may be commercially disruptive, but the Blackberry injunction scare never happened and besides is ancient history.
Judicially framing patent infringement remediation theory with vague “liability” theory instead of “property “theory corrodes our patent system by degrading patent value. Our ICT patent community colleagues have been selfishly pursuing “liability theory” for more than a decade. Junk science academic accusations of a “tax on innovation”, speculative theories about patent “holdups”, “thickets” and “royalty stacking” and phony litigation and troll crises are over. Global markets moving up the value chain are signaling it’s time for the US to revalue patents as investors redirect their support to China and the EU. Talented researchers and students are headed there as well.Unless our new Court changes its direction, US innovation’s competitive advantage will follow them.

Continue reading Time to Undo eBay

Items of Interest and Importance

Capitol Hill publication Politico notes today that a letter urging President Trump to lift the hiring freeze at the USPTO argues persuasively that the agency is supported by its users. It also notes that Michelle Lee is likely to be replaced. Both items are important and need no further elaboration from us. Continue reading Items of Interest and Importance

Researcher Patent Assignments Redux?

TTO directors remember their sickening feeling when the Stanford vs. Roche sent them scrambling for legal advice about university researched invention ownership and assignment. SCOTUS held that an earlier researcher promise to assign IP to their universities was trumped by an actual assignment made later. The case stirred debate about choice of law conflicts between state contracts law and federal patents. More important it raised the question of how to reliably verbalize future pre-invention assignments. Was an assignment valid if executed pre-invention?  Were assignments necessary every time an invention or discovery occurred?  Some universities have focused on acknowledging a PI’s on-going responsibility to report to university TTO’s any investigative undertaking that could possibly be patentable. One of the issues now raised by the Alice/Mayo eligibility line of cases may be the narrowing meaning of “potentially patentable” in the UCSC case described below where the university focused more on the researcher’s acknowledging a dual obligation to assign and disclose patentable inventions. The relevant UCSC operable language appears to have been:

“I acknowledge my obligation to assign inventions and patents that I conceive or develop while employed by University or during the course of my utilization of any University research facilities or any connection with my use of gift, grant, or contract research funds received through the University. I further acknowledge my obligation to promptly report and fully disclose the conception and/or reduction to practice of potentially patentable inventions to the Office of Technology Transfer or authorized Licensing office.”
Continue reading Researcher Patent Assignments Redux?

Death by a Single Cut

Yesterday at the USPTO I had the privilege of serving on the opening panel of the 12th Annual Advanced Patent Law Institute sponsored by The Texas University School of Law, Antonin Scalia Law School at George Mason University and the USPTO itself. The panel was organized and moderated by Rob Sterne and former CAFC CJ Paul Michel. It included Damon Matteo, Paul Stone, Peter Detkin and Paul Evans, all of whom are prominent, accomplished investors in innovation. Our audience of more than 200 advanced practitioners, judges, and USPTO personnel, included USPTO Director Michelle Lee. For the remainder of the two-day conference, its emphasis would be to sharpen its attendees’ legal skills. But for its first 75 minutes, patent non-investability was the panel’s sobering focus. Continue reading Death by a Single Cut